Nick Clegg's formal announcement on the withdrawal of the Lords reform Bill marks the end of a longtime Lib Dem dream for this parliament.
The coalition government is on course for a bitter clash over the issue of parliamentary boundary reforms.
Conservative ministerial aides are told they will be sacked if they vote against the Lords bill - but some are prepared to accept that fate.
Things got heated in the Commons today as Nick Clegg took issue with Harriet Harman's response to his statement on House of Lords reform
As Deputy Prime Minister Nick Clegg formally announced the government's withdrawal of the Lords reform Bill, he said he hoped the process had "inched us forward" towards such a measure in the future.
He told MPs with a smile, "I would like to make a statement on House of Lords reform ... or what's left of it."
– Deputy Prime Minister Nick Clegg
I can confirm that the government has today withdrawn that Bill, about which I am not as happy as members behind me are.
Regrettably the coalition will not be able to deliver Lords reform during this parliament.
My hope is that we will return to this in the next parliament, emboldened by the historic second reading vote.
For now, the immediate decision for the Government is how we fill the gap in the legislative timetable and we will bring forward measures to promote growth."
Deputy Prime Minister Nick Clegg confirmed today that the government has abandoned its proposal for House of Lords reform.
Speaking in parliament, Mr Clegg said he still hopes that plans for a mainly-elected second chamber would be revived in the next parliament as he formally confirmed to MPs that the Bill had been withdrawn.
What happened to governing in the national interest?
The Coalition, which came together in May 2010 with its leaders promising a new kind of politics, appears now to be tearing itself apart with the Prime Minister and Deputy Prime Minister engaged in a public slanging match over constitutional reform.
First Nick Clegg lambasts his Coalition partners for ditching House of Lords reform, then he says he won't vote for the boundary changes David Cameron wants.
Now the Prime Minister has hit back, saying he'll push ahead with the boundary reforms in the face of Liberal Democrat opposition.
The only people who must be enjoying this new 'tit-for-tat' sport are the Shadow Cabinet, Labour - which cleverly skewered House of Lords reform despite being in favour of it in principle - the likely winner.
The divisions in the Coalition appear to be widening as David Cameron insisted today that proposed boundary changes to parliamentary seats will go ahead.
It comes a day after the Liberal Democrat leader and deputy Prime Minister Nick Clegg said he would block the plans to reduce the number of MPs to 600 and make constituencies more equal.
It's estimated, the proposals would give the Conservatives an extra 20 seats. But they won't get through the Commons without Liberal Democrat support.
David Cameron has spoken about the Lords reform and boundary changes, blaming Labour and "others in Parliament" for abandoning Lords reform the Prime Minister said:
"I was not going to have month after month of wrangling when the real issue facing this country is getting our economy moving."
However Mr Cameron made no comment on the state of the coalition after Nick Clegg accused the Conservatives of breaking the coalition contract.
Mr Clegg has withdrawn support for proposed boundary changes which Mr Cameron said he still wanted to go ahead.
The Labour peer Lord Winston has given his reaction to government plans to reform the House of Lords.
He told ITV News there was a strong possibility that the Bill "might not get to the House of Lords as it had been so badly prepared".
He also explained why he thinks the current motivation for Lords reform is "immoral" and highlighted the benefits of a non-elected chamber.